Infrastructure Bonds_Sec D_Group 2

8/3/2019 Infrastructure Bonds_Sec D_Group 2

http://slidepdf.com/reader/full/infrastructure-bondssec-dgroup-2 1/34

Infrastructure Bonds –

A Research Study

Section D : Group No 2

Anvit Sah 2010187Archana George 2010188

Ashish Mukharjee 2010189Ashwin Ramaswamy 2010190

Bharat Kumar 2010191Chaitanya Kini 2010192



Reasons for choosing this project Infrastructure bonds are a new investment option

available to Indian investors.Awareness level among Indians about

infrastructure bonds is thought to be low.The purpose of choosing the project is to gauge

the awareness levels of individuals, about theavailability of infrastructure bonds as aninvestment option for generating returns andsaving on tax under Sec 80(c).This would then help us to give suggestions to

companies about offering these kind of bonds tothe general public.



Literature ReviewUnderstanding that people’s investment decisions

depend primarily on the returns generated, risk factorsinvolved, tax savings, time duration of investment andheavily on the level of knowledge an individualinvestor possesses about different investment

instruments (Jackson, Andrew, The AggregateBehaviour of Individual Investors, July 29, 2003)

Understanding that an investor chooses an investment

option based upon his tolerance to risk which is furtherbased on his age profile. (Individual Risk Attitudes:New Evidence from a Large, Representative,Experimentally-Validated Survey, February 2006)



Qualitative research using Expert Panel

The investment parameters identified from theliterary review were sent to the expert panelconsisting of CA’s, Finance faculty and Banking

executives for their relevance to infrastructure

bonds.

Number of parameters reduced to 7 based onfeedback.



Management Objective

To gauge the perception about

infrastructure bonds among workingprofessionals and their awareness level



Research Objective

Check the relation between factorslike, age, income levels, marital

status and gender versus thereasons for investing in

infrastructure bonds.



Method for data collection

All data was collectedonline by sending a

questionnaire to variousworking professionalsaround India.

Sampling: Convenience,

Judgemental & Snowball



Data Interpretation



Sample Number of people

Aware 78

Not Aware 29

Total 107


Total Aware 78

Invested 21

Not Invested 57



0%

13%

1-10%

64%

11-20%

21%

21-30%

2%

Willingness to Invest


0% 14

1-10% 69

11-20% 22

21-30% 2

Total 107



Percent of savings willing

to invest

Number of people

1-10% 16

11-20% 4

21-30% 1

Percent of savingswilling to

invest

Number of people

0% 14

1-10% 53

11-20% 18

21-30% 1



Data Analysis



Check for Normality of data

Check for validity of the scale

The most significant factors

Relation between low risk perception and: IncomeGenderMarital statusAge

Relation between tax benefit perception and: IncomeGenderMarital statusAge



Variables Considered



Tests Used



Reliability Test

Objective: Measure the reliability of the questionnaire

Cronbach's alpha indicated the overall reliability ofthe questionnaire

Cronbach’s Alpha above 0.5 is considered good, the value obtained by

the questionnaire is 0.640



Normality Test

Objective: To test if the data that is collected is Normal

The data that is collected is Normal, except for Age, Marital Status and Gender, since the

Skewness and Kurtosis is on the higher side.



The Significant Factors

Objective: Among the 7 parameters observed, to

get the most critical parameters

Test: One way Anova

The p-value obtained was less than 0.05, indicates there is significant difference

between the parameters. Based on the means, the most critical parameters were,

1. Tax Benefits2. Low risk of Investment



Income

Age

Marital Status

Gender

Risk Versus:



H0 :There is no relation between the different income levelsand the low risk perceived

Risk Versus Income

The significance is >0.05, hence the null hypothesis stands true.



H0 :The median risk perceived by different agegroups is equalNon parametric data -- Test: Kruskal – Wallis Test


Risk Versus Age



H0 : There is no relation between the MaritalStatus and the low risk perceived

Non parametric data-- Test: Mann Whitney Test


Risk Versus Marital Status



H0 : The median risk rating by males andfemales are equal

Non parametric data-- Test: Mann Whitney Test

The Wilcoxon W is not between the sum of ranks, hence the Null hypothesis is

Rejected. Thus there is a difference in the risk rating between male and females.

Risk Versus Gender



Tax Versus:

Income

Age

Marital Status

Gender



Tax Versus Income

H0 :The median tax saving rating for all incomegroups are equal

The significance is < 0.05, hence the null hypothesis is rejected. Thus there is a

significant difference between the income groups and the tax benefits perceived.



Objective: To find which income group values

tax benefits from Infrastructure bonds



Conclusion: The group having salary > Rs 8 lacs valued tax benefits more

when compared to other income groups



H0 :The median tax benefit rating for married andunmarried individuals is equalNon parametric data-- Test: Mann Whitney Test

The Wilcoxon W is not between the sum of ranks, hence the Null hypothesis is Rejected.

Thus there is a difference between the married and married the tax benefits perceived.

Tax Versus Marital Status



Conclusion A company issuing infrastructure bond can portray the

bonds as low risk and high tax benefit option to reinforcethe perception of the people.

The company can target high income group people ( > 8

lacs/annum) for selling these bonds.

There is a difference in the perception of risk or taxbenefits of infrastructure bonds with gender.

There is no difference in the perception of risk or taxbenefits of infrastructure bonds with marital status andage.



Recommendations for future study

Comparison of the availableinfrastructure bonds offered by variouspublic and private companies.

Comparison of factors considered forInfrastructure bonds may be extended to

other investment options to determinetheir perception in the minds of targetsegment.



Limitations of current study

It is a non probabilistic sample based on acombination of convenience, judgmentaland snowball techniques.

Responses were more skewed towards aparticular age group.

The questionnaire was administered onlineand thus is not that reliable in comparison

with researcher administeredquestionnaire.

Infrastructure Bonds_Sec D_Group 2

Documents

Transcript of Infrastructure Bonds_Sec D_Group 2